Foreclosure Faqs

Foreclosures: Frequently Asked Questions

Q: What is a HUD owned home?

A: If payments are not made on a home insured by an FHA loan, then the lender will foreclose and file an insurance claim for the unpaid loan balance with The United States Department of Housing and Urban Development (HUD). At this point, title is conveyed to HUD and the house becomes a HUD owned home.

Q: Who can buy a HUD owned home?

A: Any qualified purchaser can make an offer to buy a HUD home. All offers must be submitted by a certified HUD approved real estate agent. Before making an offer, the prospective buyer must have a pre-qualification letter (with Credit Report approved by lender) for the loan amount needed, earnest money and a signed contract. Buyers paying cash must provide proof of available funds.

Q: How are HUD homes sold?

A: All HUD homes are sold by electronic bid. Only licensed brokers/agents that are registered with HUD may place an offer on behalf of their buyers. After the first ten days on the market, bids are analyzed and the highest net that is acceptable to HUD by an owner occupant will be accepted. If no bids are accepted, then bids are looked at daily and open to all buyers, including investors.

Q: What is "The Good Neighbor Next Door Program?"

A: Single family houses that are located in Revitalization Areas are offered to eligible full-time law enforcement officers; full-time, certified, pre-K-12 schoolteachers, full-time Emergency Medical Technicians and full-time Firefighters. The Good Neighbor Next Door Program (GNND) allows these buyers to receive up to a 50% discount. Certain restrictions apply; contact an SRG agent for more details.

Q: What is the difference between a HUD-owned and an REO foreclosure?

A: Offers on HUD properties are submitted through electronic bid. HUD will either accept or reject the offer. Offers on REO properties are submitted via TREC contract along with seller's addenda and negotiating takes place.

Q: Is there a minimum bid required on HUD properties?

A: No. HUD at its discretion may accept or turn down any offer. By working with a Specialized Realty Group buyer's agent or an agent experienced with HUD, you can have access to historical data on what other HUD properties have sold for recently. This information can help you determine how much you need to offer to have the best chance of winning the bid.

Q: Who determines the list price on HUD properties?

A: The list price is determined by an FHA appraiser.

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Why Specialized Realty for buying Foreclosures?

• Our firm specializes in Texas foreclosure properties.
• Our agents are foreclosure experts.
• Our foreclosure focus experience helps us to keep you from potential penalties.
• Our foreclosure expertise ensures a smooth process for our buyers.
• Our experience in working with foreclosures helps you avoid any unforeseen penalties.
• We can make you aware of foreclosures before they go on the market.
• SRG buyer's agents represent the buyer, not the seller.
• We offer a market analysis to assist with negotiations.
• We have connections with lenders and mortgage who know foreclosures best.
• We work with foreclosures on a daily basis, so we know when a "hot deal" comes up.
• We offer foreclosures throughout North Texas.
• We have connections with lender and mortgage providers with hands-on experience working with foreclosures.

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